United States: New York State Adopts Additional Laws To Combat Discrimination And Harassment

The New York State Legislature passed several bills at the end
of its 2019 session which, yet again, will impact New York
employers. Some of the new legislation further amends laws that were implemented last year, which
required employers to review and update their policies and practices. Notably,
employers currently doing business in New York City may find that
they are already in compliance with some of the new laws, as
certain measures in the new legislation are similar to
employee-friendly laws previously enacted in New York City.

The provisions in the new bills affecting private employers in
New York are summarized below. The provisions have varying
effective dates, and employers should note the date each law goes
into effect after enactment (the date the Governor signs the
bill).

New York State Human Rights Law Will Apply to All Employers
Regardless of Size

A8421/S6577 (as amended by S6594/A8424), amends the New York State Human
Rights Law (NYSHRL), by expanding the definition of
“employer” to include all private employers, regardless
of the number of employees. Prior to this amendment, except as to
sexual harassment, the NYSHRL covered employers with four or more
employees.

This law will go into effect 180 days after
enactment.

New Standard for Proving Discriminatory Harassment

One of the most significant provisions in the new legislation is
the modification of the legal standard for harassment claims under
the NYSHRL. Currently, to be actionable under the NYSHRL,
harassment must be sufficiently “severe or pervasive”
to alter the conditions of the victim’s employment.
A8421/S6577 eliminates the “severe or pervasive”
standard and instead provides that “harassment,”
including retaliatory harassment, under the NYSHRL is an unlawful
discriminatory practice when an employer subjects “an
individual to inferior terms, conditions or privileges of
employment because of the individual’s membership in one or
more [] protected categories.”

New York City eliminated the “severe or pervasive”
standard for harassment claims under the New York City Human Rights
Law (NYCHRL) in 2009. Under the NYCHRL, a plaintiff bringing a
harassment claim must prove that he or she has been “treated
less well” than other employees because of the
individual’s protected status. Williams v. City of
New York, 61 A.D.3d 62 (1st Dept. 2009). It is unclear how the
courts will interpret the “inferior terms” standard
but, notably, the New York State law specifically provides that
employees need not “demonstrate the existence of an
individual to whom the employee’s treatment must be
compared.”

Further tracking the NYCHRL, the NYS law makes available an
affirmative defense to liability if the employer can show that the
alleged “harassing conduct does not rise above the level of
what a reasonable victim of discrimination with the same protected
characteristic would consider petty slights or trivial
inconveniences.”

This law will go into effect 60 days after enactment and
will apply only to claims accrued on or after that effective
date.

Additional Requirements for Enforcement of Non-Disclosure
Provisions In Relation to Agreements Resolving Any Claim of
Discrimination

As we previously reported, in 2018, New York State
amended the General Obligations Law and the Civil Practice Laws and
Rules (CPLR) to prohibit employers from including nondisclosure
agreements (NDAs) in any settlement, agreement or other resolution
of a claim involving sexual harassment, unless the complainant
expresses a preference for confidentiality and such preference was
memorialized in writing. A8421/S6577 expands the prohibition to
apply to all claims or causes of action of
discrimination. Further, the confidentiality preference in the NDAs
must be provided “in writing” to all parties “in
plain English, and if applicable, the primary language of the
complainant.”

The new legislation also states that such confidentiality
provisions shall be void if they prohibit or restrict a complainant
from “(i) initiating, testifying, assisting, complying with a
subpoena, or participating in any manner with an investigation
conducted by the appropriate local, state, or federal agency; or
(ii) filing or disclosing any facts necessary to receive
unemployment insurance, Medicaid, or other public benefits to which
the complainant is entitled.”

Additionally, under A8421/S6577, any contract or agreement
between an employer and employee entered into on or after January
1, 2020 that prevents the disclosure of “factual information
related to any future claim of discrimination” is void and
unenforceable unless the agreement “notifies the employee or
potential employee that it does not prohibit him or her from
speaking with law enforcement, the equal employment opportunity
commission, the state division of human rights, a local commission
on human rights, or an attorney retained by the employee or
potential employee.”

This law will go into effect 60 days after
enactment.

Elimination of
the Faragher-Ellerth Defense

Following New York City, A8421/S6577 eliminates an affirmative
defense, called the Faragher-Ellerth defense, which
employers have relied on in cases brought under New York State law
involving supervisor harassment. That defense has been available
under federal law and the NYSHRL against claims of hostile work
environment harassment where employers can show that either (a) no
tangible adverse employment action was taken against the
complainant; (b) the employer exercised reasonable care to prevent
and correct the harassing behavior; and (c) the complainant
unreasonably failed to take advantage of the preventive or
corrective opportunities that the employer provided. The new law
eliminates this affirmative defense for NYSHRL claims; under its
provisions, if a complainant does not make a complaint about
harassment to the employer, that fact will not be determinative of
whether the employer is liable under the NYS law.

This law will go into effect 60 days after enactment and
will apply only to claims accrued on or after that effective
date.

Non-Employee Service Providers Protected From All
Discrimination

Last year, New York State made it an unlawful discriminatory
practice for an employer to permit sexual harassment of
non-employee service providers (contractors, subcontractors,
vendors, consultants, and anyone else providing services) in its
workplace. A8421/S6577 amends this law to protect non-employees
from all unlawful discrimination, not just
sexual harassment.

This law will go into effect 60 days after enactment and
will apply only to claims accrued on or after that effective
date.

Recovery of Punitive Damages and Attorneys’ Fees

Under A8421/S6577, plaintiffs and complainants who prevail on
claims of employment discrimination against private employers under
the NYSHRL in court or before the NYS Division of Human Rights
(NYSDHR) may potentially recover punitive damages. In addition, if
the respondent has been found liable for having committed an
unlawful discriminatory practice, an award of reasonable
attorney’s fees may be awarded to the prevailing plaintiff or
complainant in the discretion of the court or the Commissioner of
the Division of Human Rights. This marks a significant change in
New York State law, which did not authorize punitive damages for
employment discrimination and only provided for attorney’s
fees for employment discrimination cases on the basis of sex.

The New York State Court of Appeals recently ruled
in Chauca v. Abraham, 30 N.Y.3d 325 (2017), that
punitive damages under the NYCHRL are determined by application of
the common-law standard: whether the wrongdoer has engaged in
discrimination with “willful or wanton negligence, or
recklessness, or where there is a ‘conscious disregard of the
rights of others or conduct so reckless as to amount to such
disregard.’” It remains to be seen whether the punitive
damages under the NYSHRL will be assessed under the same
standard.

This law will go into effect 60 days after enactment and
will apply only to claims accrued on or after that effective
date.

NYSHRL Must Be Liberally Construed

Further tracking the NYCHRL, A8421/S6577 states that the NYSHRL
must be construed liberally for the accomplishment of the remedial
purposes of the law and that exceptions to and exemptions from the
laws “shall be construed narrowly in order to maximize
deterrence of discriminatory conduct.”

This law will go into effect immediately after enactment and
will apply only to claims accrued on or after that effective
date.

Prohibition of Pre-Dispute Mandatory Arbitration Agreements for
All Discrimination Claims

Currently, CPLR Section 7515 prohibits employers from requiring
mandatory arbitration of sexual harassment claims. A8421/S6577
amends Section 7515 to apply to all claims of
discrimination. Note, however, that the express limitation within
Section 7515 — “[e]xcept where inconsistent with
federal law” — remains unchanged. As we previously indicated, this provision
raises serious questions regarding whether it has any practical
application, given the strong preference for arbitration
demonstrated in the Federal Arbitration Act and consistently
restated in numerous decisions of the United States Supreme Court
and lower courts. Indeed, as we recently reported, Southern District of
New York Judge Denise Cote in a June 26, 2019, decision enforced
the parties’ pre-dispute arbitration agreement with regard
to, among other claims, plaintiff’s hostile work environment
cause of action, ruling that “the FAA sets forth a strong
presumption that arbitration agreements are enforceable and this
presumption is not displaced by § 7515.”

As we previously reported, less than a year
ago, New York State required all employers to distribute to all
employees a written sexual harassment prevention policy and provide
annual, interactive sexual harassment prevention training to all
employees. In addition to these requirements, under A8421/S6577,
employers must now provide all employees, at the time of hiring and
at every annual sexual harassment prevention training provided,
“a notice containing such employer’s
sexual harassment prevention policy and the information presented
at such employer’s sexual harassment prevention training
program” (emphasis added). This notice must be provided in
writing in English and in the language
identified by each employee as their primary language, provided
that the State provides its model policy and training in such
language.

This law will go into effect immediately after
enactment.

Statute of Limitations for Sexual Harassment Claims
Extended

Under A8421/S6577, complainants will have three years to file a
complaint of sexual harassment under the NYSHRL with the NYSDHR,
which is the same statute of limitations for employees to file
claims of sexual harassment in court. The new legislation does not
affect other discrimination and harassment claims filed with the
NYSDHR, which continue to be subject to a one-year statute of
limitations. This change in the law is consistent with a recent amendment to the NYCHRL, which extended
the time to file a complaint of sexual harassment under the City
law with the NYC Commission on Human Rights from one to three
years.

This law will go into effect one year after
enactment.

NYS Adopts a Salary History Inquiry Ban

On July 10, 2019, Governor Andrew Cuomo signed S6549/A5308b, which enacts a state-wide salary
history inquiry ban. New York State joins other jurisdictions
within the state (NYC and Westchester and Suffolk counties) that
previously enacted laws prohibiting employers from inquiring about
salary history during the process of considering an individual for
a job.

Rely on an applicant’s wage or
salary history in determining whether to offer employment or in
determining the wage or salary for such individual.

Orally or in writing seek, request,
or require an applicant or current employee’s wage or salary
history as a condition to be interviewed, as a condition of
continuing to be considered for an offer of employment, or as a
condition of employment or promotion.

Orally or in writing seek, request,
or require an applicant or current employee’s wage or salary
history from a current or former employer, current or former
employee, or agent of the applicant or current employee’s
current or former employer.

Refuse to interview, hire, promote,
otherwise employ, or otherwise retaliate in any manner against an
applicant or current employee (i) based on the individual’s
prior wage or salary history; (ii) based on the individual’s
refusal to provide wage or salary history information; or (iii)
based on the filing of a complaint with the Division of Human
Rights alleging a violation of this law.

Like the City law, the new legislation does not prohibit an
applicant or current employee from voluntarily, and without
prompting, disclosing or verifying their wage or salary history. If
at the time an employer provides the applicant or current employee
with an offer with compensation the individual provides their prior
wage or salary history to negotiate, the employer may confirm such
wage or salary history.

However, there are several notable differences between the
City’s law and the state legislation. Under the state
legislation, the law applies not only to applicants, but also
current employees. Further, unlike the City law, the state
legislation does not specifically authorize prospective employers
to engage in discussion with applicants about
their expectations with respect to compensation
and benefits, including any unvested equity or deferred
compensation that an applicant would forfeit by leaving his or her
current employer.

This law will go into effect on January 6, 2020 (i.e., 180
days after enactment).

Prohibition of Race Discrimination Based on Natural Hair or
Hairstyles

On July 12, 2019, Governor Cuomo signed S6209a/A7797a. The new legislation amends the
NYS Executive Law to expand the term “race” to include
“traits historically associated with race, including but not
limited to hair texture and protective hairstyles.” The term
“protective hairstyles” includes, without limitation,
such hairstyles as braids, locks, and twists. Employers may
recall our recent alert that discussed the NYC
Commission on Human Rights’ announcement and issuance of
legal enforcement guidance that, among other things, interpreted
the NYCHRL’s prohibition of race discrimination to ban
discrimination on race-related hair and hairstyles.

This law went into effect on July 12, 2019 (i.e.,
immediately after enactment).

Expansion of Equal Pay

On July 10, 2019, Governor Cuomo signed S5248-B/A8093a. The new legislation amends
the equal pay provisions of the New York Labor Law (NYLL), which
currently prohibits gender-based pay inequity, to apply to members
of all protected classes under the NYSHRL. Under
the new legislation, individuals who believe they are underpaid due
to their protected status will be able to bring a claim for equal
pay directly under the NYLL. The NYLL has a six-year statute of
limitations, which is double the three-year statute of limitations
applicable to claims under the NYSHRL, and also provides for treble
damages in the event of a violation of the law.

Additionally, the new law lowers the burden of proof for an
individual claiming an equal pay violation by requiring employers
to ensure equal pay for “substantially similar work,”
as opposed to “equal” work.

However, the law permits a differential in rate of pay if the
employer can show that such decision is based on (i) a seniority
system, (ii) a merit system, (iii) a system measuring earnings by
quantity or quality of production, or (iii) a bona fide factor
other than the protected status, such as education, training or
experience, which is job-related and consistent with business
necessity.

This law will go into effect on October 8, 2019 (i.e., 90
days after enactment).

Implications for Employers

The new bills effect major changes to New York’s
discrimination and harassment laws. As discussed above, many
provisions of the new bills are similar to laws already enacted in
New York City; thus, employers currently operating in New York City
may already be in compliance with certain of the new New York State
laws. Because Governor Cuomo has signed, or is expected to sign,
all of these bills, employers in New York State should be aware of
these changes and consider taking the following next steps:

Ensure that harassment policies
eliminate references to the “severe or pervasive”
standard, which will no longer apply to claims of harassment under
the NYSHRL and NYCHRL.

Review discrimination, harassment,
and retaliation policies to include a statement that the policies
extend protections to non-employees.

Prepare template settlement and
separation agreements that will comply with the anticipated
requirements in the new law concerning NDAs applicable to
resolution of discrimination claims.

Make plans to include the carve-out
language that will be required for confidentiality provisions in
agreements entered into on or after January 1, 2020.

Prepare the required
“notice” containing the employer’s sexual
harassment policy and the information provided by the sexual
harassment prevention training, and distribute such notice at the
time of hiring and at every annual sexual harassment prevention
training. If an employee identifies a primary language other than
English, and the State makes available a model sexual harassment
prevention policy and training template in such language, the
employer must provide a translated version of its policy to the
employee in his or her primary language.

Review interview and hiring practices
to ensure compliance with the salary history ban. Employers are
encouraged to review our previous alert regarding the NYC salary
history ban, which includes suggested “next
steps.”

Review grooming practices and
policies to ensure that they do not run afoul of the State’s
new law prohibiting race discrimination based on an
employee’s hair texture or hairstyle.

Carefully analyze and maintain
documentation noting the reasons for any pay differentials for
substantially similar work.

We will monitor developments pertaining to these new laws and
provide updated information when the State issues rules or other
guidance. Because the laws go into effect on varying dates,
employers should monitor the date that the Governor signs these
bills and calendar the effective date of each law.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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